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High seas swindle: Citi slammed for chairing bank group to decarbonize shipping while funding deepwater drillships

Citi is chairing the push to decarbonize shipping, despite having pumped millions into controversial deepwater drillships this year.

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The bank chairing the push to decarbonize shipping has pumped millions into controversial deepwater drillships this year.

Citi’s chairing of the Poseidon Principles, which involves reducing the emissions in shipping, is also being questioned as the group’s latest annual report published today shows the bank’s score on meeting targets for reducing financed emissions in shipping has worsened again.

Citi was involved in loans this year to two drillships owned by Transocean, including a $486 million loan for the building of a new ship, the Aquila, and a $525 million loan for upgrades to the Titan. Since 2016, Citi has pumped over $2.5 billion into Transocean, including $407 million in 2019, the year the Poseidon Principles were set up. Citi has also financed another drill ship builder Valaris, pumping in over $600 million since 2016.

Offshore drilling is one of the riskiest types of oil and gas extraction, given the oil spills and damage to marine life it involves. The Aquila ship will be built on the coast of Brazil, threatening sensitive marine ecosystems and coastal communities that rely on fishing—including Quilombola communities, Afro-Brazilian descendents of escaped slave populations. Many communities in Brazil have powerfully resisted ‘petro-dependency’ for years, calling out the oil and gas industry’s contamination of their land, air, and water and violations of their rights to healthy and safe working and living conditions.

Citi’s project financing of drillships and funding for off-shore drilling companies comes as banks and energy companies seek to cash in on high oil prices and drill in more remote settings, including the ocean bed. At the same time banks like Citi say they remain committed to Net Zero targets. 

Stand.Earth criticized Citi’s chairing of the Poseidon Principles while funding destructive drillships as “greenwashing”:

“Citi is acting like a rogue pirate on the high seas: riding the wave of oil and gas profits while plundering the depths of our oceans through funding harmful drillships. Citi chairing the Poseidon Principles to decarbonize shipping while backing dangerous new drillships is one of the most blatant greenwashing moves we’ve seen from the bank to date,” said Hannah Saggau, Senior Climate Finance Campaigner with Stand.earth.

The release of the latest annual report by the Poseidon Principles puts further into doubt Citi’s commitment to decarbonizing shipping with its score worsening every year since 2021. Citi’s is 33% over the emissions reduction the International Maritime Organization has said needs to be met.